The manufacturing industry in countries like the UK, US and Australia have struggled in recent years. Countries offering manufacturing services at more competitive prices have experienced growth in the industry. After slow growth during 2014, manufacturing in the UK is already off to a shaky start in the new year. British manufacturers aren’t feeling particularly confident about the coming year. This information is according to the annual survey of manufacturing executives by EEF/Aldermore. In the US, the sector is expanding, but very slowly. And in Australia, the manufacturing industry has contracted. Other countries have been hit too, including Hungary and Taiwan. But it’s not all bad news. The sector experienced growth in recent months is other regions, including Switzerland and India.
This time last year, 70% of British manufacturing executives said they were confident that 2014 would be a good year. But in 2015 only 37% felt that they could say the same, according to a survey by EEF/Aldermore. Some of the issues concerning manufacturers include rising input costs and the health of the eurozone, which is an important export area for the UK. 38% of those surveyed are expecting a global downturn in the industry this year, a five percent increase on last year’s respondents.
The growth rate in the sector turned out lower than expected in December 2014, which has caused a sense of pessimism about the future. In addition, ECB president Mario Draghi has said that the threat of deflation in the eurozone is rising. These comments caused the euro to fall to its weakest against the dollar since June 2010. However, it isn’t all bad news. 2014 is set to show the highest rate of manufacturing growth in the UK over the last four years, at 3.5%. Many manufacturing businesses, such as gpxgroup have had great success in recent times and continue to expand and modernize their output.
Meanwhile, manufacturing growth in the United States was also slow. However, the sector is growing, despite its lethargic rate. Although it’s increasing more slowly, it could also be growing at a more sustainable rate. The industry experienced weak numbers in December. But many factories are confident that this was a blip that will be overcome. Experts are feeling confident about the new year, in contrast to their UK counterparts. Although the ordering index fell, the employment index for manufacturing rose. This increase in employment could further show the confidence firms have in the conditions of the market. Companies are unlikely to take on more employees if they’re worried about poor performance in the new year.
The US isn’t the only country feeling confident about the year ahead. Analysts at Credit Suisse are “cautiously optimistic” about the outlook for the Swiss manufacturing industry. It experienced growth in December. However, the question for many countries might be that of just how important manufacturing still is to the economy. For many, it claims a significantly smaller percentage of the market than other industries.
